Tuesday, November 17, 2009

Ca$h for Gold, or Checks for Suckers?

Most people around Town have probably seen those annoying little stickers on the front page of the Not-So-Local Rag, aka Yellowwich Time - you know, the ones that usually take the pixels right off that picture you had been curious to see. Not infrequently they advertise an outfit called "Ca$h for Gold", which has been setting up shop on a weekly basis at the Hyatt Regency for the better part of two years now.

With the recent run-up in the price of gold, your scribe thought he would take that old watch he had bought at a tag sale some years ago for $5, and which Terry Betteridge had said at the time was probably worth $10-15 as scrap. Imagine your scribe's delight when the man at Ca$h for Gold told him it was worth "about $60". But that was only a come-on, of course.

The man was a born haggler. $60 quickly turned into $50. "I'd be losing $10 if I paid you $60," he told your scribe, who replied, "Well, then, pay me $55 so you'll only be losing $5." The man thought that was pretty funny, so he agreed. But the "Ca$h for Gold" people do not pay cash. They write checks instead, and demand ID which is then noted on a form. Your transaction is about as anonymous as the police blotter of the Not-So-Local Rag.

Then your scribe brought out a British sovereign - you know, the gold coin that James Bond carried in his belt and American aviators carried in their emergency kits during World War II. The man stated that it contained a quarter of an ounce of gold, which is approximately correct, and added that collectible gold coins command a premium over scrap gold because they are suitable for purchase in an IRA or the like. He divided the spot price of gold by four, and came up with an offer of $277. Your scribe accepted.

But when he went back the next day with a similar coin, the man had changed his tune. He called some mysterious "partner" who instructed him to offer $231. Since the price of gold had jumped nearly $30 an ounce in the past 24 hours, your scribe had been expecting an offer of $285 or so. Any legitimate coin dealer would have offered something within a few dollars of that price, because of the coin's marketability. $231?! That was highway robbery!

The man showed him a group of similar coins he had bought from someone else earlier in the day at a paltry $225 (the spot price had been lower then). Your scribe was appalled. Some unsuspecting person had taken an offer that was hundreds of dollars less than the true value of the coins.

Feeling sullied by having shaken this man's hand at the outset of the visit, your scribe quickly left and washed his hands in the nearest men's room. What a rip-off this operation had now revealed itself to be! And so, your scribe's advice to anyone who might be considering paying a visit to these folks is very simple: Don't. Go to a reputable jeweler or coin dealer instead.

As usual, the Romans have a phrase to fit the situation: Caveat vendor. Don't let this shady operation make a sucker out of you. And be sure to warn your friends, as well.


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